Financial incentives to promote the use of high value health services (e.g. medications for chronic illnesses) are the foundation of the novel value-based health plan design. Group Health Cooperative plans to implement an innovative value-based health plan design for its 9100 employees in Washington State. The plan, which takes effect in 2010, includes co-payment waivers for care-planning visits for patients with six highly prevalent adult chronic conditions, waived and reduced co-payments for medications used to treat and prevent complications of six chronic illnesses, and increased co-payments for elective high-end imaging. The overall goal of this research is to prospectively evaluate this natural experiment, using a quasi-experimental time-series design with an external employee control population. The primary aims of this application are to examine changes over time in self-reported health status, absenteeism due to illness, lost productivity time at the workplace. The secondary aims are to assess the association of the introduction of the value-based health plan on clinical quality scores for chronic illness care and preventive screenings, lifestyle behavioral risk factors, employee satisfaction with health benefits, health services utilization by employees, and employer-paid health costs for the employee population. We plan to evaluate key employee health and productivity outcomes associated with this new value-based health plan design, examining administrative data for 4 years before, and 3 years after, the start of the new health plan design in January 2010. Sources of data for this study will include a combination of administrative claims, pharmacy, laboratory and detailed human resources data for the entire enrolled populations of both organizations. We will also collect primary survey data from a randomly selected sample of 10,000 employees at baseline during fall 2009 as part of preliminary work for the study, and then again, as part of the study, at 12, 24 and 36 months after baseline for outcomes not available in the secondary data listed above. The mail/web survey will consist of 55 items with key primary outcome measures (SF-12, Work Health Questionnaire) and secondary outcome measures (employee satisfaction, lifestyle behavioral risk items regarding tobacco use, high-risk alcohol use, body mass index and physical activity). Other primary outcomes (absenteeism, claims costs and quality scores) will be assessed using automated data sources. Outcome measures will be analyzed yearly for each cohort. Descriptive statistics computed for the two cohorts will include percentages and frequencies for categorical measures and medians and inter-quartile ranges for continuous measures. We will use regression analysis to estimate the impact of Total Health on outcomes assessed via the survey of employees as well as outcomes that rely on secondary data provided by both organizations. The results of this evaluation will provide much needed high-quality evidence to understand the impact of an innovative value-based health plan design on the health and productivity of an employee population.